- (1.) THIS civil revision has been filed against the order passed by the Addi tional District Judge dismissing the appeal against the order of the trial Court dismissing the defendant's application for deciding the suit in terms of an alleged compromise. In the suit, an application (20-C) was moved on 7-9-1970 by the parties stating that talks of compromise were going on between the par ties and they had already appointed an arbi trator (Panch). It was further stated that as the arbitrator was likely to take some time in giving his award the hearing of the case be adjourned and later on the suit may be decid ed in terms of the award to be given by the arbitrators (Panchon). On 20-10-1970 the de fendant moved an application with a prayer that the suit may be decided in terms of the award given by the arbitrators. The plaintiff filed objections to the award and contended, inter alia, that the arbitrators had misconduct ed themselves as well as the proceedings. When the matter came up before the Court the plaintiff refused to give consent to the decision of the suit in terms of the award.
(2.) AT the hearing of the matter it was contended by the defendant that the award should be treated as a settlement of the dis pute within the meaning of Order 23, Rule 3 of the Code of Civil Procedure and a decree be passed under that provision. The trial Court did not accept the contention because the plaintiff had not given his consent to the decision of the suit in terms of the award. It held that without such consent the dispute could not be deemed to have been settled be tween the parties out of Court. The applica tion was accordingly rejected and the suit was directed to be proceeded with. The defen dant went up in appeal. The appellate Court took the same view as was taken by the trial Court. It also held that the award, not hay ing been made in accordance with the provi sions of the Arbitration Act, could not be given effect to as an award and without the consent of the plaintiff could also not be re garded a compromise within the meaning of Order 23, Rule 3, Civil P. C. The defendant has raised the same pleas in the Revision. According to the learned counsel for the ap plicant the parties should be deemed to have settled their dispute out of Court in terms of the award within the meaning of Order 23, Rule 3 of the Code of Civil Procedure. The submission is that by stating in the applica tion (20-C) D/- 7-9- 70 that the suit may finally be decided in terms of the award that may be given later on, the parties should be deemed to have settled their dispute by a compromise in terms of the award that was to follow. There is no merit in the contention. 1974 All/4 H G-13 Obviously, the award, having not been made in accordance with the provisions of the Arbitration Act, could not as such be treated to be a valid award_ to form the basis for the decision of the suit. The only pro vision in the Arbitration Act which permits the decision, of the suit on the basis of an award is Section 47, which reads as under: Section 47:- "Subject to the provisions of Section 46 and save in so far as is other wise provided by any law for the time being in force the provisions of this Act shall ap ply to all arbitrations and to all proceedings thereunder: Provided that an arbitration award other wise obtained may with the consent of all the parties interested be taken into considera tion as a compromise or adjustment of a suit by any Court before which the suit is pend ing." This proviso leaves no doubt that an arbitra tion award by itself does not amount to a compromise or adjustment of a suit. If it Were not to be so, the proviso would not have required the obtaining of fresh consent to the award. Order 23, Rule 3 of the Code of Civil Procedure states:- "Where it is proved to the satisfaction of the Court that a suit has been adjusted wholly or in part by any lawful agreement or compromise, or where the defendant satis fies the plaintiff in respect of the whole or any part of the subject-matter of the suit, the Court shall order such agreement, compro mise or satisfaction to be recorded and shall pass a decree in accordance therewith so far as it relates to the suit." The essential ingredient of Rule 3 of Order 23, Civil P. C. is the agreement or compromise. An agreement or compromise between the parties can only be where the parties them selves agree to a settlement. It requires a consensus of mind of the parties themselves. In Webster's New International Dictionary the word 'agreement' in legal terminology is stated to mean: "A concurrence in an engagement that something shall be done or omitted; an ex change or promise, mutual understanding, ar rangement, or stipulation." 'Compromise' according to the Concise Ox ford Dictionary means: "Settlement of dispute by mutual con cession". Neither 'agreement' nor 'compromise' corn-templates the imposition on parties a decision by somebody else. The terms do not include within their ambit an arbitration award how soever secured. Where the settlement is not by voluntary act of the parties themselves, i.e., through the application of their own minds, it cannot be an agreement or com promise entered into by the parties. If a matter is left to be decided by a third person, then his decision would not be an agreement or compromise between the par ties, but would be an award. Order 23, Rule 3, Civil P. C. does not contemplate an 'award' in the terminology of 'agreement or compromise'. It is for this reason that pro viso to Section 47 of the Arbitration Act was enacted. Similar was the view taken by a Full Bench of this Court in the case of Moradhwaj v. Bhudar Das, AIR 1955 All 353 (FB). It was observed: "The words "with the consent of all the parties interested" are intended to resolve the conflict that prevailed before the Act came into force. These words obviously have re ference to the award. All the parties interest ed must consent to the 'award' being given effect to. Where they do not so consent, the award cannot be taken into consideration as a compromise or adjustment. The consent of the parties to the reference merely and not to the award can by no stretch of imagi nation be deemed to be a consent to the award itself as actually made."
(3.) THE application dated 7-9-1970 shows that the parties were contemplating a compromise and for that purpose had agreed to refer the dispute to arbitration and after the award was to be given, the suit was to be decided in terms of the award. If the law did not permit the Court to decide the suit in terms of the award obtained in a manner not provided by the Arbitration Act, mere agreement of the parties that the suit be decid ed in terms of the award will not confer any power on the Court to decide the suit in terms of the award. The suit can be decided in terms of such an award only by treating it as a compromise or adjustment, but that too cannot be done unless both the parties consent thereto. This requirement about con sent is embodied in the proviso to Section 47 of the Arbitration Act. The agreement men tioned in application No. 20-C could not amount to the consent to the award within the meaning of the proviso to Section 47 of the Arbitration Act, or even otherwise, be cause the consent had to be a consent to the decision contained in the award and the same could not possibly be given before the award had been made. Consent contemplated by the proviso to Section 47 is the consent given after the award to the terms of the award and not the prior consent to be bound by the award. This was also the view taken by this Court in the case of AIR 1955 All 353 (supra). The award, not being consented to by the plaintiff after it was given by the arbi trators, could not be deemed to record the agreement or compromise between the parties and could not amount to a settlement of the dispute through compromise for the purpose :of Order 23, Rule 3, Civil P. C.;